Crypto custodian BTSE has launched an ERC-20 token representing Monero (XMR) on the Ethereum blockchain, giving investors new exposure to the privacy-focused coin.
Represented by the ticker symbol WXMR, Wrapped Monero is meant to bring more liquidity to the DeFi ecosystem. The new asset is fully backed by Monero in a one-to-one ratio and secured by BTSE.
In a press release shared with Cointelegraph, BTSE said that WXMR “gives Monero holders more flexibility to use their tokens without having to sell them for Ethereum or stablecoins to access the many exciting opportunities in the DeFi space. “
Monero represents one of crypto’s most fascinating use cases, and its proponents consider XMR to be one of the most important tenants of decentralized networks: privacy guarantees.
While governments have been steadily building digital assets like BitcoinBTC) and Ether (ETH), they have been much more critical of privacy coins like XMR and Zcash (ZEC). Tired of Know Your Customer and anti-money laundering regulations, exchanges have delisted privacy coins to ensure they don’t violate the law.
Recently, Bittrex became the latest high profile exchange to scrap privacy coins, including XMR.
In this sense, BTSE says that Monero’s greatest strength – strong privacy features – is sometimes seen as a drawback. By holding Wrapped Monero, users can provide the transparency necessary to meet the KYC / AML requirements that are increasingly ubiquitous in the crypto trade.
If the packaged version of Bitcoin is any indication, Monero could get a boost from WXMR. Wrapped Bitcoin (WBTC) allows people to use BTC as collateral on the Ethereum blockchain, a move that sparked the DeFi boom.
In the case of WBTC, there has been more flow from DeFi to the price of Bitcoin, according to Sam Bankman-Fried of Alameda Research. It remains to be seen whether a comparable throughput will benefit the value of XMR.
BTSE did not immediately respond to a request for comment.